Alexandre Rocha*
alexandre.rocha@anba.com.br
São Paulo – Bilateral trade between Brazil and the Arab countries, i.e. the sum of exports and imports, stood at US$ 13.5 billion in 2007, an increase of 12% compared with 2006. The figure is a result of US$ 7 billion in exports from Brazil, 5% more than in the previous year, and US$ 6.5 billion in purchases of Arab goods, a growth of 20.13%. The figures were disclosed yesterday (16th) by the president at the Arab Brazilian Chamber of Commerce, Antonio Sarkis Jr.
"With each new year, more companies are aiming at the Arab market, being successful in doing so and obtaining large market shares," stated Sarkis. "We are pleased with the figures, but they could be even more significant," he asserted.
He recalled that early in the administration of president Luiz Inácio Lula da Silva, when exports from Brazil to the Arabs stood at US$ 2.6 billion per year, the Arab Brazilian Chamber presented a study to the government showing that sales could amount to US$ 7 billion in four years.
"At that time many people would not believe it, but we did reach that level. There was a one-year delay, but we did it," said Sarkis. "The Chamber has been talking about the potential of the Arab market for a long time, and now it is more widely known to all," he claimed.
According to him, had it not been for the decrease in sugar prices, expansion in revenues from exports to the Arabs would have been greater. Until 2006, the commodity was the main item in the export basket, and although the shipped volume remained stable in 2007, revenues from sugar sales to the region decreased 24% to reach US$ 1.63 billion. According to information supplied by the Ministry of Agriculture, the price of one tonne of sugar went down from US$ 327 in 2006 to US$ 263 in 2007.
Sarkis called attention to the fact that sales of other goods made up for the decrease in the price of sugar, as was the case with meats, which became the leading item in the export basket, with US$ 2 billion in exports, an increase of 27%, soy, for which shipments grew 15%, wood and pulp (66%), building material (67%), dairy products (440%), semi-manufactured iron and steel products (83%) and agricultural machinery (36%). "Excluding sugar, together, the remaining products grew 20%," he declared.
He also highlighted the fact that the Arab Brazilian Chamber is investing in promotion of higher value-added products, such as construction material, items for the hotel industry and industrialised foodstuffs.
As examples, Sarkis cited actions, among them the participation of Brazilian companies in the Big 5 Show, a trade fair for the construction sector held in Dubai late last year, which the organisation promoted in partnership with the Brazilian Export and Investment Promotion Agency (Apex-Brasil), and two simultaneous business missions to Gulf countries. On that occasion, during a dinner offered by the Chamber at the Jumeirah Beach Hotel, approximately 150 Brazilians and over 120 Arab businessmen were in attendance. He also said that in February, the organisation is going to take Brazilian companies to the Gulfood, a food sector fair that is also held in Dubai.
With regard to imports, petroleum was the key driver of growth. Brazil imported the equivalent to US$ 5.55 billion in oil and derivatives from Arab countries, against US$ 4.88 billion in 2006. Fertiliser imports also grew, rising from US$ 217 million in 2006 to US$ 500 million in 2007. This led the Brazilian balance of trade surplus to decrease, closing at slightly over US$ 500 million, compared with US$ 1.3 billion last year.
Growth of 10% in 2008
In 2008, Sarkis estimates that bilateral trade should expand approximately 10%. "And this is a conservative estimate," said Sarkis, who is expecting a rise in sugar prices and in exports of other goods. The president at the Chamber also said that trade relations should become stronger after the 2nd Summit of South American – Arab Countries, scheduled to take place this year.
*Translated by Gabriel Pomerancblum
